FULL YEAR RESULTS

Statement Of Profit And Loss For The Quarter Aad Year Ended 31 December 2007 And 31 December 2006

Review Of Performance

4Q2007

The Group reported a 7.5% rise in revenues at the close of the fourth quarter for FY2007. Revenues for the quarter rose from $117.3 million to $126.1 million. Profit before tax increased 78.9%, rising from $0.3 million to $0.5 million. In addition to contributions from operations, the quarter also saw a revaluation gain on its investment property. At the close of the quarter, net profit after tax stood at $0.6 million representing an increase of 34.9% as compared to $0.4 million reported in the same quarter in the previous financial year.

Other income increased by 358.4% from $0.2 million to $1.1 million. This is mainly due to the write back of impairment loss on investment property, arising from a revaluation gain on its market value.

Operating activities generated cash flows of $3.8 million in 4Q2007. This is lower than the $5.8 million generated in the 4Q2006, due mainly to the increase in stocks during the quarter. Compared to the same quarter in FY2006, sales and distribution costs rose 41.2% from $3.6 million to $5.1 million; general and administrative expenses rose 19.1% from $2.9 million to $3.4 million; and finance costs rose from $0.4 million to $0.6 million due to increased headcounts and higher borrowings.

FY2007

For the financial year ended 31 December 2007, the Group reported a 7.2% rise in revenues, which rose from $454.2 million in FY2006 to $486.8 million. Profit before tax stood at $2.1 million compared to $3.5 million due to higher operating costs incurred in FY2007.

Sales and distribution costs increased by 26.4% from $15.0 million in FY2006 to $19.0 million in FY2007, mainly due to increased headcounts. General administrative expenses rose 6.7% from $12.2 million in FY2006 to $13.0 million and finance costs rose 81.2% from $1.3 million in FY2006 to $2.3 million due to higher bank borrowings in FY2007.

Interest-bearing loans and borrowings rose from $12.5 million in FY2006 to $31.7 million. This brought the Group's bank gearing ratio to 0.7 times from 0.3 times in the previous financial year.

Trade debtors rose from $65.0 million to $69.9 million and stocks rose from $49.8 million to $63.4 million. Trade debtors and stock turnover during the year were marginally higher at 50 days and 45 days.

For the financial year ended 31 December 2007, cash used in operating activities stood at $13.7 million. This is comparatively higher than the $9.6 million used in the previous financial year due to higher stocks and trade debtors balances at the close of FY2007. Cash and cash equivalents at the close of FY2007 amounted to $9.6 million, as compared to $6.9 million in FY2006.

By business segments, the two core businesses - “Design-in” and “Distribution” contributed 50.9% and 48.3% of the Group's revenues. The balance is contribution from “Sub-system” manufacturing. Earnings before interest and tax contributions from “Design-in” and “Distribution” stood at $3.3 million and $2.1 million while “Sub-system” manufacturing reported a loss of $1.1 million in FY2007.

Geographically, Hong Kong and China accounted for about 62.4% of the Group's total revenue in FY2007. This is significantly higher than the 57.0% revenue contribution reported in FY2006. The strongest growth in FY2007 was from Thailand, which reported a 223.4% increase in revenues due to the contribution from a major customer. Revenue contribution from Thailand rose from $9.1 million in FY2006 to $29.5 million in FY2007. India turned in a 5.9% increase in its revenue contribution.

Current Year Prospects

Hong Kong and China will remain the major contributors to the Group's business. On the R&D front, it will continue to develop platforms and solutions to bring new applications to new market segments. Into the new financial year, the Group expects to benefit from these initiatives.

Balance Sheet