MultiVision Posts Record Net Profit Jump Of 49% to HK$37.6 Million

• Turnover rose 35% to HK$129.0 million on the back of improved sales from extensive global marketing and highly visible reference projects;
• Basic EPS rises 11% to 9.46 HK cents in FY2004 from 8.49 HK cents in FY2003;
• Sees three pillars of growth in Banking, Transportation and Gaming
  

SINGAPORE, 27 May 2004 - MultiVision Intelligent Surveillance Limited ("MultiVision") today announced that its net profit attributable to shareholders for the Financial Year ended 31 March 2004 ("FY2004") rose 49% to HK$37.6 million, compared to HK$25.3 million in FY2003, the highest levels since it was listed on the Main Board of the Singapore Exchange in 2002.

Performance Review

The Hong Kong-based leading provider of integrated digital video surveillance products and solutions said the net profit was achieved on a 35%-increase in turnover to HK$129.0 million (FY2003: HK$95.3 million), which was also a record high. The increased turnover resulted from significantly higher contributions from Macau due to the delivery of digital video surveillance products and solutions to the Group's distribution partner, Elixir Group, for an extensive surveillance upgrading project under the gaming company Sociedade de Jogos de Macau, S.A. ("SJM").

The project for 17 SJM casinos and facilities is ongoing and is scheduled for completion in FY2005.

Gross profit increased to HK$71.8 million from HK$50.1 in FY2003, leading to higher gross profit margin of 56% for FY2004 (FY2003: 53%). The improvement in margin was due to the shift in product demand towards high-end surveillance products. Profit after tax grew significantly by 49% to HK$37.6 million (FY2003: HK$25.3 million) due to the successful expansion of our business in the year, on the basis of a well-developed customer base and proven reference sites, and the tax rebate of HK$5.3 million for offshore profits claimed in Hong Kong. Basic earnings per share ("EPS") were 9.46 HK cents (FY2003: basic 8.49 HK cents) as at 31 March 2004; net asset value backing per share was 60 HK cents, compared to 28 HK cents for FY2003.

The sales growth was propelled by widening acceptance of MultiVision's suite of digital video surveillance products and solutions, aggressive marketing in various business segments and countries, the successful implementation of highly visible projects, promising end-user references, as well as good execution of distribution strategy. Increasing sales in customised products and solutions, economies of scale from the higher order volume, cost savings on licensing after acquisition of perpetual license for software application drivers and better sales of premium surveillance products led to the improved operating profit.

Commenting on the Group's performance, President and Chief Operations Officer Mr. Dennis Li said: "The worldwide growth for the surveillance industry is estimated to be about 9% for calendar 2004. We are pleased to have performed much better with growing demand for our products and solutions in the banking, transportation and gaming industries in which we have extensive domain expertise. We have secured new markets in Africa and gained significant foothold in the US and UK through tight collaboration with our distribution partners, and at the same time, complementing their efforts by locating our sales and support offices in
these countries to reduce the time-to-market and maximising the market penetration."

Distribution and administrative expenses increased to HK$29.3 million due to opening of new offices for at-location sales and high responsive support in the US, UK, Australia and Macau. HK$12.5 million has been amortised and invested in product and solution development programmes for next- generation surveillance systems.

Inventories increased in anticipation of order delivery to the distribution partner, Elixir Group in Macau. Trade receivable also registered an increase of 98.9% to HK$50.9 million due to higher amount of orders from distributors throughout the year and the completion of several major projects in March 2004.

The Group's cash and cash equivalents rose to HK$79.3 million at 31 March 2004 from HK$49.7 million at the end of the previous year.

Outlook and Guidance for FY2005

The first stage of installing digital video surveillance systems for over 100 branches and 150 ATMs for Hunan Postal Services in China is on schedule for completion in first quarter of FY2005 ("Q1 FY05") with the potential of further installations later in FY2005. The Group is also on schedule for the installation of systems for the London Lines contract in UK and the pilot phase is expected to complete by Q1 FY05. Installations for the Macau casinos and facilities are still ongoing and are expected to complete by end of FY2005. The Group is currently in negotiations for new projects in Macau. The joint-venture project with China Netcom under Sino Gear Force has been rolled out with the first public distribution of surveillance software to be made available in June 2005.

Mr. Li believes: "The strong growth momentum achieved in FY2004 should carry forward to FY2005 as we make forays into new market segments and countries. With the buoyant demand for digital video surveillance systems to replace analog systems, MultiVision will be capitalising on our domain expertise in the Banking, Transportation and Gaming sectors to capture analog-to-digital platform migrations, the vertical markets and focus on delivering end-to-end solution offerings to our customers. These three sectors shall be fuelling our growth for FY2005."

The competition in the global arena is intensifying as more competitors are introducing systems which also feature hardware compression capabilities. Systems from MultiVision now feature not just hardware compression but also leading-edge applications. The Group is expanding strategic alliances to more telecom operators so that the surveillance products can be bundled with broadband services, thereby adding a new continuous income stream through sale of products and solutions and extending MultiVision's current distribution- and projects-driven business model.

MultiVision also announced today it has acquired the surveillance business from Acqis Technologies Inc. ("Acqis"), OEM supplier for its NetServer Smart series of mobile surveillance products with wireless communication capabilities. The purchase includes perpetual access to seven patents for iMod and iSat systems which are features found in NetServer Smart.

The NetServer Smart offers mobile surveillance with wireless communication and other features such as real-time video streaming, license plate recognition and alerts, critical for civic and safety purposes.

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About MultiVision Intelligent Surveillance Limited
(Bloomberg: MVIS SP EQUITY/ Reuters: MVIS SI)
Headquartered in Hong Kong, MultiVision was established in 1986 and is a technology-based company principally engaged in the design, development and distribution of digital video surveillance products and solutions. The Company's products are adapted for use in a diverse range of industries including banking, residential, commercial, utilities, healthcare and transportation, as well as various government agencies. The end-users of MultiVision's products include companies in both the private and public sectors. MultiVision is ISO9001 certified.

MultiVision's products and solutions are marketed to distributors, OEMs of surveillance products and systems integrators for integration into the security and surveillance systems of its end-users. The Company's principal markets are in Australia, Hong Kong, Taiwan and the PRC. MultiVision has 27 distributors in various countries and/or places such as Hong Kong, Taiwan, Macau, the PRC, Thailand, Malaysia, Singapore, Indonesia, Australia, New Zealand, Israel, Ghana, The Middle East, Ireland, UK, Latvia and the USA.

The MultiVision range of digital video surveillance products offers digital video recording and real time monitoring of multiple locations from a central monitoring centre through the routing of signals from various cameras to a central monitoring centre.
For further information, visit www.multivision.com.hk

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