DBA Telecommunication (Asia) Holdings Limited is Hong Kong-based company. Its subsidiaries are engaged in design, manufacture and sales of telecommunication equipment and related products. The Company has three segments: manufacturing business, self service business and agency business. Manufacturing business includes design, manufacture and sales of telecommunication equipment and related products; self-services include sales of telecommunication value-added cards, insurance prepaid cards and online game value-added cards through smart card vending machines, and agency business includes trading of telecommunication products. Its subsidiaries include Skyban International Holdings Limited, Fujian Create State Industry Co., Ltd., International Intelligent System Limited and Skyban Telecommunication (Fujian) Limited.

The Group is principally engaged in the information technology business, self-service business and agency business for telecommunication products in the PRC. The Group’s revenue is generated from three main categories, namely, manufacturing business, self-service business and agency business for telecommunication products :

(i)	Information technology business: the design, manufacture and sales of telecommunication equipment and related products.
(ii)	Intelligent self-service business: sales of telecommunication payment cards through smart cards vending terminals and promote, design, produce and publish advertisement.
(iii)	Agency business for telecommunication products: to act as an agent of the suppliers to sell telecommunication products to cooperative distribution networks.

For the year ended 31 December 2010, the Group's turnover increased 73.3% to Rmb 3,658 mil, and profit attributable to Shareholders increased 120% to Rmb 237 mil. The business activities within the period were summarized as follows:

 

(i)	Information Technology Business : Turnover increased 24.8% to Rmb 763 mil. which accounted for 20.8% of the Group's turnover. Operating profit increased 55.9% to Rmb 222 mil
(ii)	Intelligent self-service business: Turnover increased 95% to Rmb 2,860 mil. which accounted for 78.2% of the Group's turnover. Operating profit increased 100% to Rmb 161 mil
(iii)	Agency business for telecommunication products: Turnover increased 7.5% to Rmb 35.8 mil. Operating profit increased 7.5% to Rmb 8.23 mil
(iv)	As at 31 December 2010, the Group had cash and cash equivalents of approximately 496 mil, total borrowing amounted to approximately 286 mil

- The Group manufactured a wide range of products, including 94 models of public telephone booths, 8 models of ATM booths, 15 models of smart card vending machines, 30 models of ODFs and 13 models of optical passive devices etc..
- The Group had approximately 15 active customers in the PRC, which include major operators of telecommunication services, covering 28 municipalities, provinces and autonomous regions. The Group’s products are distributed to its customers through its own sales network in the PRC. As at 31 December 2009, the Group had 33 representative offices in the PRC.
- The Group’s production facilities are situated at Fuqing Rongqiao Economic and Technology Development Zone. The Group’s production facilities have an annual production capacity of approximately 120,000 units of public telephone booths, 100,000 units of smart card vending machines, 2,500,000 units of ODFs and 130,000 sets of optical passive devices.

- For the year ended 31 December 2009, the Group’s turnover increased 29.9% to Rmb 2,111 mil, and profit attributable to Shareholders decreased 57.7%, to Rmb 109 mil. As at 31 December 2009, the Group had total assets of Rmb 1,770 mil.The group’s cash and cash equivalents amounted to approximately Rmb 761 mil. The business activities within the period were summarized as follows:

 

(i)	Manufacturing Business : Turnover decreased 40.6% to Rmb 611 mil. Operating profit decreased 64.1% to Rmb 142 mil
(ii)	Self-service business: Turnover increased 190% to Rmb 1,466 mil. Operating profit increased 210% to Rmb 79.7 mil.As at 31 December 2009, the Group has altogether six branches established in six provinces and 6,000 points-of-sale
(iii)	Agency business for telecommunication products: Turnover decreased 63.7% to Rmb 33.3 mil. Operating profit decreased 25.7% to Rmb 7.6 mil

- For the six months ended 30 June 2009, the Group’s turnover increased 13.8% to Rmb 936 mil, and profit attributable to Shareholders decreased 61.8%, to Rmb 60 mil. The business activities within the period were summarized as follows:

 

(i)	Manufacturing Business : Turnover decreased 37.5% to Rmb 324 mil. which accounted for 34.7% of the Group’s turnover. Operating profit decreased 64.3% to Rmb 65 mil, including :
1.	Sales of telecommunication network extension equipments: Turnover decreased 66.1% to Rmb 49 mil. Sales of telecommunication information terminal equipments: Turnover decreased 67.5% to Rmb 33 mil. Sales of intelligent electronic products: Turnover decreased 18.1% to Rmb 143 mil. Sales of Optical transmission connection products: Turnover increased 2.8% to Rmb 99 mil.
2.	For the six months ended 30 June 2009, the Group acquired 24 patents of outlook design and 1 patent of utility model and filed application for 3 patents of utility model and 4 patents of software copyright.
(ii)	Self-service business: Turnover increased 160% to Rmb 599 mil. which accounted for 64% of the Group’s turnover. Operating profit increased 160% to Rmb 35 mil
(iii)	Agency business for telecommunication products: Turnover decreased 82.8% to Rmb 12 mil. Operating profit decreased 50% to Rmb 2.8 mil
(iv)	The Group’s cash and cash equivalents amounted to approximately Rmb 802 mil. as at 30 June 2009. It had total assets of Rmb 1572 mil.

- For the year ended at 31 December 2008, the Group’s turnover and profit attributable to Shareholders increased 35.7% and 4.2%, to Rmb 1625 mil. and Rmb 258 mil. respectively. The business activities within the period were summarized as follows:

 

(i)	Turnover increase was attributable to persistent growth of the manufacturing business and self-service business. Gross profit increased 23.2% to Rmb 470mil. Gross profit margin decreased to 28.9% from 31.8% last year.
(ii)	Manufacturing business : Turnover increased 19.3% to Rmb 1029 mil. which accounted for 63.3% of the Group’s turnover. Operating profit increased 13.2% to Rmb 327 mil.
a.	Sales of telecommunication network extension equipments: Turnover increased 15.8% to Rmb 327 mil. which accounted for 20.1% of the Group’s turnover. The increase was attributable to the expansion of “Best Tone” project of telecommunication operators, the replacement of public telephone booths and growing demand for public telephone booths with display surfaces for advertisements.
b.	Sales of telecommunication information terminal equipments: Turnover decreased 28.5% to Rmb 171 mil. which accounted for 10.5% of the Group’s turnover.
c.	Sales of intelligent electronic products: Turnover increased 21.6% to Rmb 362 mil. which accounted for 22.3% of the Group’s turnover. The increase was mainly attributable to the enormous card service market including that for telecom calling cards. It was also attributable to the Company directing more efforts into research and development of new products that integrate telecommunication technologies and industry applications
d.	Sales of Optical transmission connection products: Turnover increased 56.2% to Rmb 169 mil. which accounted for 10.4% of the Group’s turnover. The increase in turnover was mainly attributable to the expansion and development of optical transmission communication networks and the Group’s efforts in improving product quality.
(iii)	Self-service business: Turnover increased 150% to Rmb 504 mil. Operating profit increased 130% to Rmb 23 mil. During the year, the Group had additional 3,000 points-of-sale installed with an smart card vending terminal each in Fujian, Beijing, Chongqing and Hubei. As at 31 December 2008, the Group had approximately 4,000 points-of-sale in total.
(iv)	Agency business for telecommunication products: Turnover decreased 32.1% to Rmb 91.67 mil. Operating profit increased 56.4% to Rmb 10.31 mil.
(v)	The Group’s cash and cash equivalents, mostly denominated in RMB and Hong Kong dollar, were approximately RMB797 million as at 31 December 2008. It had total assets of Rmb 1552 mil., comprising noncurrent assets of approximately Rmb 289 mil. and current assets of approximately Rmb 1263 mil.

- For the year ended at 31 December 2007, the Group’s turnover and profit attributable to Shareholders increased 78.6% and 34.1%, to Rmb 1198 mil. and Rmb 247mil. respectively. The business activities within the period were summarized as follows:

 

(i)	Sales of telecommunication network extension equipments: Turnover increased 20% to Rmb 269 mil. which accounted for 22.5% of the Group’s turnover. The growth was attributable to the Group’s effort in launching new models with advanced functions and better exterior design.
(ii)	Sales of telecommunication information terminal equipments: Turnover increased 11% to Rmb 184 mil. which accounted for 15.4% of the Group’s turnover.
(iii)	Sales of intelligent electronic products: Turnover increased 27% to Rmb 283 mil. which accounted for 23.6% of the Group’s turnover. The increase in turnover was mainly attributable to the growing popularity of telecommunication payment cards and the launch of new models of smart card vending machines.
(iv)	Sales of Optical transmission connection products: Turnover increased 120% to Rmb 127 mil. which accounted for 10.6% of the Group’s turnover. The increase in turnover was mainly attributable to the Group’s efforts in improving quality of the products and maintaining competitive prices of existing as well as new products.
(v)	Self-service business: Turnover amounted to Rmb 200 mil. which accounted for 16.7% of the Group’s turnover. The Group had a total of approximately 1,000 points-of-sale installed with a smart card vending terminal each in Fuzhou and sales of communication payment cards were satisfactory.
(vi)	Agency business for telecommunication products: Turnover amounted to Rmb 135 mil. which accounted for 11.3% of the Group’s turnover.

- For the year ended at 31 December 2006, the Group’s turnover and profit attributable to Shareholders increased 20.2% and 25.5%, to Rmb 670 mil. and Rmb 184 mil. respectively. The business activities within the period were summarized as follows:

 

(i)	Sales of Communication Terminal Equipment: Turnover increased 7.5% to Rmb 390 mil. which accounted for 58.2% of the Group’s turnover. Of the segmental total, turnover derived from the sales of public telephone booths increased by 13.4% to approximately RMB224 million, accounting for approximately 33.4% of the Group’s total turnover. As for the turnover derived from the sales of public telephones and wireless business telephones, it increased by 0.4% to approximately RMB166 million and accounted for approximately 24.8% of the Group’s total turnover.
(ii)	Sales of Intelligent Electronic Products: Turnover increased 53.8% to Rmb 223 mil. which accounted for 33.2% of the Group’s turnover.
(iii)	Sales of Communication Transmission Connection Products: Turnover increased 14.1% to Rmb 57 mil. which accounted for 8.6% of the Group’s turnover.

- For the year ended at 31 December 2005, the Group’s turnover and profit attributable to Shareholders increased 45.1% and 32.6%, to Rmb 558 mil. and Rmb 147 mil. respectively. The business activities within the period were summarized as follows:

 

(i)	Sales of Communication Terminal Equipment: Turnover increased 39.4% to Rmb 363 mil. which accounted for 65.1% of the Group’s turnover.
(ii)	Sales of Intelligent Electronic Products: Turnover increased 63.4% to Rmb 145 mil. which accounted for 26% of the Group’s turnover.
(iii)	Sales of Communication Transmission Connection Products: Turnover increased 41.2% to Rmb 50 mil. which accounted for 8.9% of the Group’s turnover.
(iv)	Communication Terminal Equipment included public telephone booths, public telephones and wireless business telephones in the communication, which turnover was Rmb 198 mil, Rmb 94 mil and Rmb 71 mil respectively, and accounted for 35.4%, 16.9% and 12.8% of the Group’s turnover.

- For the year ended at 31 December 2004, the Group’s turnover and profit attributable to Shareholders increased 44.9% and 49.4%, to Rmb 384 mil. and Rmb 111 mil. respectively.

Development Plans

- The Group intend to implement below business strategies:

 

1.	In order to cope with the anticipated demand for the Group’s products and to facilitate the production of new products, the Group intends to expand the production capacity through construction of new production facilities. It is planned that the new production facilities will be built on a piece of land to be located and acquired in Fuqing, Fujian Province, the PRC. The Group has not entered into any legally binding agreement in relation to the acquisition of such piece of land. The Group expects that the construction of the new production facilities will be completed approximately one year from the Listing Date.
2.	The Group intends to install at the new production facilities more advanced production equipment and machinery for the production of the Group’s products. These advanced production equipment and machinery include laser technology metal cutting machine, digital metal drilling machine, digital non-metal cutting machine, automatic surface mounting production lines, automatic stencil printer and automatic assembly lines. The Group intends to improve the production capacities for public telephone booths, public telephones and wireless business telephones, smart card vending machines, ODFs and optical passive devices with additional capacities of approximately 125,000 units, 325,000 units, 66,500 units, 41,500 units and 667,500 sets respectively.
3.	The Group intends to expand it’s sales and marketing network in the PRC and certain markets in Asia. In order to capitalise on such expected increase in demand, the Group intends to establish 10 additional representative offices in major cities in the RC, including Chongqing, Dalian, Haikou, Harbin, Qingdao, Shenzhen, Shijiazhuang, Tianjin, Wenzhou and Zhumadian. The Group also intends to renovate the existing 21 representative offices of the Group. Furthermore, in order to promote the Group’s image and products, the Group will actively participate in trade fairs and exhibitions. In addition, the Group aims to expand into certain other markets in Asia including Cambodia, Indonesia, Malaysia, the Philippines, Thailand and Vietnam by setting up representative offices in those markets.
4.	In view of the high anticipated growth of the optical fibre market, the Group intends to develop FTTH products in addition to the Group’s existing communication transmission connection products. The Group intends to establish a research and development platform for the FTTH equipment which includes the market research and analysis of their commercial viability.
5.	The Group intends to enhance existing products. It intends to develop (i) 60 new des igns of public telephone booths; (ii) multi-media public telephone – a public telephone which supports visual image transmission as well as provision of various information services, including online banking service and internet service; and (iii) smart card vending and crediting machine – smart card vending machine with crediting function.

- In May 2006, the Group placed new shares for listing. The net proceeds of the Share Offer are estimated to be about HK$258 mil. It is intended to use the proceed as follows:–

 

(i)	approximately HK$70 mil. for the purchase of land and construction of new production facilities;
(ii)	approximately HK$65 mill. for the acquisition of advanced production equipment and machinery;
(iii)	approximately HK$36 mil. for the expansion of Group’s sales and marketing network in the PRC and certain other markets in Asia;
(iv)	approximately HK$33 mil. for the development of FTTH products;
(v)	approximately HK$29 mil. for the enhancement of existing products; and
(vi)	the remaining balance of approximately HK$25 mil. for general working capital of the Group.