Computer & Technologies Holdings Ltd. · HKEX:46
Computer & Technologies — FY2001 Earnings Presentation
45 slides from Computer & Technologies's earnings presentation, Apr 9, 2002
Slide 1: Computer And Technologies Holdings Limited
Computer And Technologies Holdings Limited Our vision is to deliver competitive advantage for enterprises to progress by optimizing their information systems efficiency.
Slide 2: Computer And Technologies Holdings Limited (SEHK 0046)
Computer And Technologies Holdings Limited (SEHK 0046) 10 years of solid growth and business successes with 57.3% CAGR Listed in the main board of Stock Exchange of Hong Kong since May 1998 Regional operations throughout China, Hong Kong, Taiwan and Singapore employing about 350 IT professiona
Slide 3: Shareholdings of the Company (December 31, 2001)
Shareholdings of the Company (December 31, 2001) Mr. C. S Ng The Founder (Personal and Through Chao Lien Technologies Limited) 41.1% 10.8% Public (Including management and 48.1% employees) [SEHK 0046] Total shares issued: 270.588 million Page 3 Annual Result Announcement 2001 - Computer And Technolo
Slide 4: Milestones and Achievements
Milestones and Achievements A decade of rewarding excitement Strong footprint in telecommunication, financial services and government sectors Prestigious leadership recognised by industry and international organisations. Page 4 Annual Result Announcement 2001 - Computer And Technologies Holdings
Slide 5: List of Major Customers
List of Major Customers Page 5 Annual Result Announcement 2001 - Computer And Technologies Holdings Limited (April 9, 2002)
Slide 6: Business Partnership with Major Vendors
Business Partnership with Major Vendors Major Vendors Partnership and Endorsement Became the first Global Strategic Alliance partner of IBM Corporation in Greater China Cisco Gold Partner in China Master-level Value-added Reseller of HP Other partners include also: Page 6 Annual Result Ann
Slide 7: Project References
Project References Project Achievements Flagship e-Government Projects for HKSAR Both Electronic Tendering System (ETS) and Electronic Service Delivery (ESD) shortlisted as finalists for the "Public Services and Democracy" category of the Stockholm Challenge Awards 2001, a unique awards progra
Slide 8: Core Business of C&T Group
Core Business of C&T Group C&T Group has a synergetic portfolio of subsidiaries offering systems and network integration services, IT solutions implementation services, as well as enterprise application software and services. The Group also operates an expanding distribution network in the region. P
Slide 9: Corporate website for stakeholder communications
We endeavor to utilize our corporate website for timely and cost-effective communications with our stakeholders For more information, please visit our web corporate site www.ctil.com or www.hk46.com Our corporate website was ranked in 2001 as one of the best among Asian listed companies by FIA Magaz
Slide 10: Analyst Briefing: Annual Results for Year 2001
Computer And Technologies Holdings Limited Analyst Briefing: Annual Results for Year 2001 Mr. C S Ng Chairman and CEO
Slide 11: Agenda
Agenda Market Environment Overview for 2001 Financial Results for Year 2001 Overall Performance of the Group Outlook Questions and Answers Page 11 Annual Result Announcement 2001 - Computer And Technologies Holdings Limited (April 9, 2002)
Slide 12: Market Environment Overview for 2001 (1)
Market Environment Overview for 2001 (1) Slow down of global economy Holding-up or decreasing corporate capital expenditure and investment in IT Slow down in telecommunications industry Fluctuation of market demand for e-Business enabling and related services in the last few years Overspen
Slide 13: Market Environment Overview for 2001 (2) Mainland China
Market Environment Overview for 2001 (2) Mainland China Telecommunications sector reached saturation for broadband infrastructure building in major regions Slow down on infrastructure building Restructuring of China Telecom created delays in certain projects Slow down in capital expenditure
Slide 14: Market Environment Overview for 2001 (3) Hong Kong and Singapore
Market Environment Overview for 2001 (3) Hong Kong and Singapore Extremely weak demand from commercial sector Delayed decision for capital expenditure even for essential IT projects Government and public sector became the major source of business opportunities Clouded with competition Leng
Slide 15: Financial Highlights - Profit and Loss
Financial Highlights - Profit and Loss HK$ (millions) 2001 2000Change Revenue 515.868420.648+22.6% Gross Profit (**) 81.67090.181-9.4% Other Revenue 11.60215.365-24.5% Selling and distribution expenses (66.845)(49.172)+35.9% Administrative expenses (#) (48.007)(32.182)+49.2% Other operating expenses
Slide 16: Financial Performance - Revenue Growth at 57.3% CAGR
Financial Performance - Revenue Growth at 57.3% CAGR for a decade Turnover - 1991 to 2001 550 450 350 Million HK$ 250 150 50 -50 Page 16 Annual Result Announcement 2001 - Computer And Technologies Holdings Limited (April 9, 2002)
Slide 17: Financial Highlights - Gross Profit
Financial Highlights - Gross Profit (**) Gross Profit was derived after deducting the followings from Revenue: Cost of Goods Sold (HK$408.5 m) Cost of delivery including related staff costs etc. (HK$14.2 m) Amortization of Deferred Development Costs and License Rights (HK$7.382 m) Part of
Slide 18: Financial Highlights - Gross Profit
Financial Highlights - Gross Profit (**) Decrease in gross profit desipte the increment in revenue Revenue mainly from Integration Division (increased by 35% from HK$330.837 million to HK$446.815 million) representing 86% of G roup revenue. Out of the HK$446.815 million, approximately 55.5% ca
Slide 19: Financial Highlights - Restructuring
Financial Highlights - Restructuring Restructuring taken place since 2H 2001 Downsizing of work force by about 20% Voluntary salary reduction by senior management and general staff Consolidated the then 8 subsidiaries (including IPL and BSAP) into four business divisions reinforcement of b
Slide 20: Financial Highlights - Other Operating Expenses
Financial Highlights - Other Operating Expenses Substantial provisions made for other operating expenses (##) Amortization and impairment of Goodwill HK$4.256 m Unrealized loss on revaluation of short-term HK$2.730 m investment Doubtful and bad debts HK$9.859 m Property and long-term inves
Slide 21: Financial Highlights - Expenses Nature
Financial Highlights - Expenses Nature Expenses may Expenses may reduce in HK$ NOT recur in significantly in millions 2002 2002 Other Operating Expenses Goodwill amortization 1.468 Goodwill impairment 2.788 X Unrealized Loss on revaluation of short-term in investment 2.73 X Doubtful and bad debts 9.
Slide 22: Statistics on Company Performance of 2001 - Segmental Analysis
Statistics on Company Performance of 2001 Segmental Analysis HK$ (millions) Profit / (Loss) before depreciation, amortisation and other 2001 Turnover 2000Change 2001 2000Change operating expenses Integration Services 446.82330.84+35.1% 13.869 24.615-43.7% Distribution Business 30.5134.62 -11.87% 1.9
Slide 23: Financial Highlights - Condensed Balance Sheet
Financial Highlights - Condensed Balance Sheet (as of December 31, 2001, in HK$ millions) 2001 2000 Non-current Assets 75.872 85.336 Current Assets 325.071415.883 Current Liabilities (53.994)(99.719) Net Current Assets 271.127316.164 Total Assets Less Current Liabilities 346.999 401.500 Non-current
Slide 24: Financial Highlights - Balance Sheet and Cash Flow
Financial Highlights - Balance Sheet and Cash Flow Maintained healthy financial position Strong balance sheet Net debt-free position More than HK$200 m cash reserve Improved positions despite higher revenue Accounts Receivable dropped to HK$81.76 m (2000: $117.91 m) Inventory decreased
Slide 25: Revenue Distribution by Business Segment
Statistics on Company Performance of 2001 Revenue Distribution by Business Segment 2000 12.6 8.2% 0.5% Integration Services Distribution Business Solutions Services 78.6 Application Services 5.90% 4.40% 3.10% 2001 86.60% Page 25 Annual Result Announcement 2001 - Computer And Technologies Holdings Li
Slide 26: Group Revenue Distribution by Industry Sector
Statistics on Company Performance of 2001 Group Revenue Distribution by Industry Sector (Excluding Distribution Business) 67.3% 2000 Telecommunications Financial Services 12.1% 8.9% Government, Utilities & Transportation 11.8% Others (including IPL) 55.5% 15.6% 2001 12.2% 16.7% Page 26 Annual Result
Slide 27: Overall Performance of the Group (1) Integration Services Division
Overall Performance of the Group (1) Integration Services Division C&T Integration Telecom continued to contributed 55.5% of Division revenue Anticipated slow-down in broadband network build-out Increasing demand for BOSS solutions and services Increased portion of business from enterprise c
Slide 28: Overall Performance of the Group (2) Solutions Services Division
Overall Performance of the Group (2) Solutions Services Division Recorded significant loss Suffered from over-capacity in resources due to substantially shrunken demand for e-business enabling and IT solutions services Faced cut-throat competition Longer-than-expected selling cycle due to mo
Slide 29: Overall Performance of the Group (3) Solutions Services Division
Overall Performance of the Group (3) Solutions Services Division Consolidated subsidiaries providing IT solutions and implementation services into C&T Solutions Global e- Computer Business And HutchTech Breakaway Accelerate blending Technologies Enabler of talents in PRC and HK for higher cost R
Slide 30: Overall Performance of the Group (4) Application Services Division
Overall Performance of the Group (4) Application Services Division Recorded controlled loss Lower than expected demand but cost also controlled at lower than initially budgeted level Completed major extension to cover Central Tender Board large tenders of the HKSAR Government Replicated busi
Slide 31: Overall Performance of the Group (5) Application Services Division
Overall Performance of the Group (5) Application Services Division While impacting short-term earning, investment in GO- Business is making progress for future contribution to the Group Demonstrated a proven business model Achieved a market leadership in e-procurement services in Hong Kong and
Slide 32: Overall Performance of the Group (6) Application Services Division
Overall Performance of the Group (6) Application Services Division IPL, acquired in July, performed reasonably well despite the challenging environment with new major customers Mercedes-Benz China / Zung Fu / KPMG Shanghai & Beijing / Philips Electronics - BCU Audio / DBS Bank Reached minimum
Slide 33: Overall Performance of the Group (7) Application Services Division
Overall Performance of the Group (7) Application Services Division Adjustments to Consideration Adjustment of total acquisition cost (cont.) Finalized consideration for 100% holdings 5.007 million shares (already issued at $3.0908 / share in July 2001) HK$8 million cash already paid in Jul
Slide 34: Overall Performance of the Group (8) Distribution Business
Overall Performance of the Group (8) Distribution Business Recorded a slight decline in revenue due to weakened consumer expenditure in Hong Kong market and initial set up cost of Taiwan operation But maintained healthy gross margin and operating profit Proven business model with a dominant po
Slide 35: Overall Performance of the Group (9) Distribution Business
Overall Performance of the Group (9) Distribution Business Expansion to Taiwan Formed JV with local partner with previous engagement in similar distribution business and product mix 70% shareholding by Maxfair Commence operations in August with rapid progression Anticipated to contribute p
Slide 36: Outlook
Computer And Technologies Holdings Limited Outlook
Slide 37: Outlook - Overall
Outlook - Overall We believe the Group’s profitability prospect will be improved in coming years Improved overall efficiency Reduced overhead through restructuring taken place Tightened integration of resources in Hong Kong and Mainland China Secured more than HK$180 million (~US$23 millio
Slide 38: Outlook - Integration Services
Outlook - Integration Services Management focus for 2002 Continuos stringent cost management Telecom Sector: Focus to pursue the market shift in the Telecom sector from high-volume, low margin network infrastructure building to higher-margin but lower-volume valued-added services and solutions
Slide 39: Outlook - Solutions Services
Outlook - Solutions Services Developed core capabilities and established successful references Billing and Customer Relationship Management solutions for telecommunications and utilities industry Latest wins Henderson Cyber’s iCare, Hongkong and China Gas Large-scale government projects with
Slide 40: Outlook - Application Services (1)
Outlook - Application Services (1) ETS extension to other government departments in Hong Kong and e-tendering to PRC Expediting effort to integrate IPL into the Group to foster expansion into China to capture the demand from MNC Collaborating with GO-Business to provide enhanced HRMS applicati
Slide 41: Outlook - Distribution Business
Outlook - Distribution Business Seeking for expansion opportunities in value-added distribution to replicate the proven model Geographical market expansion Additional product lines Continue to seek merger, acquisition and joint-venture opportunities Page 41 Annual Result Announcement 2001 -
Slide 42: Outlook - Group Development (1)
Outlook - Group Development (1) Invest in internal infrastructure for continuos efficiency improvement IT infrastructure Corporate VPN Improve financial system and HRMS Improve CRM system Service quality through standardization of processes and methodology In process to apply for ISO 9
Slide 43: Outlook - Group Development (2)
Outlook - Group Development (2) Cautious M&A with rigorous screening process Strategic skill set and technology to widen product and service offerings Software products and solutions with strong customer base Expansion into regional market Focus on Integration with core business of the G
Slide 44: Questions and Answers Session
Computer And Technologies Holdings Limited Questions and Answers Session
Slide 45: Visit Our Web at www.ctil.com
Computer And Technologies Holdings Limited Visit Our Web at www.ctil.com Our vision is to deliver competitive advantage for enterprises to progress by optimizing their information systems efficiency.
Computer And Technologies Holdings — FY2001 Earnings Presentation on 6ix