BVI-registered China Technology Development Group Corporation has announced its unaudited consolidated financial results for the six month period ended June 30, 2008.
The BVI Group decided to focus on the strategic expansion in the solar business, and proposed to dispose of its equity interest of Jingle Technology Co Ltd. and its subsidiaries. The disposal of Jingle was approved by the written resolution of the Board passed in May, 2008.
As at June 30, 2008, company’s first solar base plate production line in the factory in Fujian Province of Prc, concluded its installation and testing, but no revenues have been generated, and company’s revenues were contributed solely from IT operations in 2008 period. BVI company’s IT operations were classified as held for sale in the six months ended June 30, 2008, and the gain from this discontinued operation represented as the below:
- Decrease of revenues from US$336,000 in the six months period ended June 30, 2007 to US$249,000 by the same period of 2008 – meaning the decrease of 25.89%.
- Cost of sales decrease by US$97,000, or 61.78%, from the same period of 2007, which is actually in line with the decrease of company’s revenues.
- Increase of gross profit by US$10,000, or 5.59%, from US$179,000 to US$189,000 in 2008 period. By percentage of sales, the gross profit margin of IT operations increased by 22.63bps, and reached 75.90% in the 2008 period. T
- Decrease of selling expenses by US$25,000, or 43.10% – from US$58,000 in 2007 period to US$33,000 in 2008 Period, due to downsize of certain technical support staffs.
- General and administrative expenses decrease by US$39,000, or 15.48% – from US$252,000 in 2007 to US$213,000 in 2008 period.
General and administrative expenses of the company in the same period increased by US$700,000, or 102.94%, from US$680,000 in 2007 Period to US$1,380,000 in 2008.
Non-operating expenses mainly represented US$99,000 of loss on disposal of available-for-sale securities and US$13,000 of exchange loss on bank account denominated in Hong Kong dollars in 2008 Period.
The BVI company also maintained a deposit of US$770,000 with its main shareholder China Biotech Holdings Limited, for the purpose of financing potential investments. Additionally, the BVI company had received US$1,154,000 from China Biotech Holdings Limited for assignment agreement relating to disposal of its interests in BVI registered China Natures Technology Inc. China Technology recorded it as shareholders’ contribution in the additional paid-up capital in shareholders’ equity in 2008 period. The additional paid-in capital did not have any dilution to shareholders.
As a result of this, China Technology Development Group Corporation reported a net loss of US$1,418,000 in 2008 period as compared to a net income of US$796,000 in 2007 period.