Univision Regulatory News (UVEL)

18 December 2013

 UniVision Engineering Limited

("UniVision" or the "Group")

Interim Results

For the Six Months Ended 30 September 2013

UniVision, the Hong Kong based Group whose principal activities are the supply, design, installation and maintenance of closed circuit television and surveillance systems, and the sale of security related products, is pleased to announce its unaudited interim results for the six months ended 30 September 2013. 

Highlights:

· Revenue increased by 28% to HK$52m (H1 2012 HK$41m);

· Profit before interest and tax HK$3.6m (H1 2012: HK$0.4m).

Mr. Stephen Sin Mo KOO, Executive Chairman, added:

"Our CCTV business provides stable income and cash flow for the Group. The new contracts, particularly the Hong Kong Kai Tak Cruise Terminal, contribute to the growth in revenue during the period. We expect increase in demand for Security and Surveillance Systems business from the proposed government infrastructure projects will support the further growth of the Group's turnover over the coming financial years."

Enquiries:

Chairman's Statement

Business Review

As has been previously announced, Univision's 51% stake in the Zhongshan shopping mall has been sold to Guangzhou Hua Xin Trading Company Ltd ("Hua Xin"). Their affiliated Company, Hong Yi Real Estate Company Ltd is purchasing the remaining 49% of the mall. Whilst the terms for the sale of Univision's share in the mall have been agreed, the purchase of the 49% is in dispute. The reason for this is that the two parties do not agree on some of the commercial terms of the agreement.

The purchase of the 49% is in arbitration and has been for some months. The current situation is that the judge overseeing the arbitration has decided that it is necessary to appoint another surveyor to give an independent assessment. Despite this further delay, Univision is still of the opinion that this process must be followed and is the best way for the disposal of the shopping mall to be transacted.

As announced on 23 August 2013 UniVision, Hua Xin and Jun Heng entered into an agreement which commits Hua Xin and Jun Heng to complete the purchase of UniVision's interest in the Mall by a date not later than 28 February, 2014. ("Backstop date") There remains uncertainty as to both the decision of the Arbitration Commission and the timing of this decision. In event that either the decision is still pending on 28 February, 2014 or a decision has been handed down which is not in Hong Yi's favour, UniVision's Board would have the option of either enforcing this agreement or renegotiating the Backstop date.

We remain committed to expanding our Electrical and Mechanical ("E&M") business but it is subject to the availability of additional funding and we are exploring various methods to obtain extra funding. We are also exploring ways that the consideration for our share of the Zhongshan shopping mall can be paid so as to give Univision an expanded E&M business.

The core CCTV business continues to produce stable revenues and cash flows to the Group in the face of keen market competition. Our Gross Margin percentage remains stable and turnover increased in the six month period. This was mainly due to the Kai Tak Cruise Terminal project in Hong Kong. The Board expects that the full year performance will be favourable following the stage completion of several major infrastructure contracts.

High Definition CCTV System technology is maturing and more solutions are available in the market. In the coming year Univision will commit resources to accessing and developing new technologies and solutions to cope with the future opportunities in this area.

Recognising the patience and confidence in Univision by its investors, the Board decided to commit to the payment of Univision's first dividend since listing on AIM. The final dividend was 0.78 HK cents (gross) per share.

Financial Review

In the six month period revenues for the Group increased by 28% to HK$52m (H1 2012: HK$41m). The increase of HK$11m in the revenue was mainly due to thenew construction contract income of HK$9.8m from the Kai Tak Cruise Terminal project. This project was awarded, by the Hong Kong Government in August 2012, and has a total contract value of HK$10.96m.

Revenue from the construction contracts division, including the E&M business, recorded a growth of 41%. This was due primarily to the 121% growth in the Hong Kong business, compensating for a 41% fall in revenue in the Group's Taiwan maintenance business, which was caused by the reduction of expenditure budget by a local major customer.

The performance of Hong Kong maintenance business continues to be robust. It recorded a 39% growth in revenue and improved its profit margin. The main maintenance contract and sub-contracts with MTR Corporation Limited provided regular positive cash flow for the Group's operations.

Gross profit margin remained stable at 26% (2012: 26%). Gross Profit in the Hong Kong maintenance business improved from 35% to 43%, compensating for a reduced Gross Profit 17% in Taiwan's maintenance contracts for the period due to keen competition.

The outstanding principal of interest-free loan due to Mayne Management Limited, the group's former major shareholder, remained HK$30.8m (US$3.95m) and will be repayable on 31 March, 2014.

Profit before interest and tax during the period at HK$3.6m (H1 2012: HK$0.4m), whilst the Group recorded a profit attributable to the equity holders of HK$3.3m (H1 2012: HK$0.002m).

During the period under review, the relative strengthening in the HK$ against GBP has led to a 2.8% appreciation in the GBP reporting amount in the consolidated income statement, while a relative weak closing rate at the period ended in the HK$ against GBP led to a 0.2% depreciation in the consolidated balance sheet. All figures in GBP in the financial statements need to be adjusted for comparative purposes. The financial data is also presented in HK$ to provide a comparison with the comparative figures in 2012 that were unaffected by exchange rate fluctuations

Prospects

As the Company has stable income from the maintenance sector of our Security & Surveillance business and the subsequent completion of some major infrastructure projects, the Board are confident in being able to generate significant value to the shareholders over the coming years.

Whilst the disposal of our share in the Zhongshan shopping mall is further delayed by arbitration the Board remain of the opinion that this is the best way to generate shareholder value from the asset as it allows for more time for the Company to improve its negotiating position over the precise composition of the consideration.

The E&M business in the PRC is our growth target market. We continue to assess potential opportunities of obtaining funding to allow the Group to expand in the E&M marketplace in the PRC.

On behalf of the Board, I would like to thank our customers, suppliers and shareholders for their continued support of UniVision. I would also like to acknowledge the hard work of the management and all the staff for their contribution and dedication to the Group.

MR. STEPHEN SIN MO KOO

EXECUTIVE CHAIRMAN

18 December 2013

All revenues are from continuing operations.

Notes to the Interim financial statements for the six months ended 30 September 2013

1. Basis of preparation

The unaudited interim financial statements for the six months ended 30 September 2013 have been prepared in accordance with International Financial Reporting Standards ("IFRSs") using the policies consistent with those applied to the annual financial statements for the year ended 31 March 2013. The interim financial statements, together with the comparative information contained in this report for the six months ended 30 September 2012, does not constitute the statutory accountsof the Company.

2. Profit per share

The calculation of basic profit per ordinary share is based on the profit attributable to equity holders of the Group for the six months ended 30 September 2013 of HK$3.3m (H1 2012: HK$0.002m), and the weighted average of 383,677,323 (H1 2012: 383,677,323) ordinary shares in issue during the period.

There were no potential dilutive instruments at either financial period end.

3. Interim report

Copies of the interim report will be available for inspection at the registered office of the Company, 8/F Lever Tech Centre, 69-71 King Yip Street, Kwun Tong, Hong Kong and available on the Company's website (www.uvel.com) in accordance with rule 26 of the AIM Rules for Companies.