Last checked at 30 Jun 2009 07:00
Embargoed: For release at 7am, 30 June 2009
SINOSOFT TECHNOLOGY PLC
"SINOSOFT" OR THE "COMPANY"
TRADING UPDATE
Sinosoft, the China-based developer and provider of software and IT solutions to Chinese regional and national government agencies and export enterprises, is pleased to announce an update on trading prior to the Company's half-year end on 30 June 2009.
As previously stated, Sinosoft has adopted a strategy of broadening the base of the overall business and this remains the focus for FY2009. Sinosoft's revenue continues to be weighted to the second half and whilst contract delays and deferrals have resulted in revenues being slightly down in the first half of 2009, the pipeline for the second half is strong. Management is confident that many of the deferred government contracts will commence in H2 and that trading for the full year will broadly in line with 2008.
The Company continues to grow beyond Jiangsu province and it is pleased to announce that it has recently won a new contract worth approximately US$0.2 million to supply its e-government software to Nan An, one of the 12 major cities in Chongqing, the largest and most populated municipality in China. Sinosoft will create and install a system to enable people to submit reports and application forms such as public housing forms and marriage application forms, remotely to any government departments within Nan An. The system will then route the information to the applicable government department for processing. We expect work to be completed within the next three months.
This contract is an important step forward for Sinosoft's e-government division because it is the Company's first move into south west China where it is believed by the management that there is significant potential for the Company's products.
Elsewhere, the Company has recently signed a contract to provide e-government products to Ning Xia province. In order to reduce corruption in the government approval process for applications submitted by citizens requiring various permits, Sinosoft will be supplying software to help the provincial government ensure that each department is following the stated procedure for their different roles and proper authorisation is obtained for each step of the approval process.
We are currently in advanced discussions with a top PRC software company, for the provision of our Skytech Reports Software, which was developed in 2008 as an e-government product. There is further potential for this product to be supplied to corporate sector clients.
In June 2009, the Company entered into a two year outsourcing contract to collaborate with Singalab Pte Ltd, a Singapore IT company in the provision of programming and coding work for a project they are working on. In the initial phase of the contract, two engineers will be stationed in Singapore for a month while 12 other engineers based in PRC will provide additional technical support. It is expected that the number of engineers will gradually increase as the project progresses. By collaborating with Singalab, there is potential for Sinosoft to expand its outsourcing business.
During this relatively quiet period in terms of roll-out of the SAT, the Company has been improving the functionality of its export tax software and creating a number of bolt-on services for existing users in Jiangsu. By working on these improvements, Sinosoft has a more comprehensive suite of products in anticipation of renewed demand once exports in China start to recover and the economic environment is more stable.
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For further information, please contact:
Sinosoft Technology plc
Yifa Yu, Finance Director
yuyifa@sinosoft-technology.com
Hanson Westhouse Limited Tavistock Communications
Tim Metcalfe/Richard Baty Simon Compton
020 7601 6100 020 7920 3150